price negotiation

Winning can be Losing

In my business of commercial relocation there are times when I have to negotiate an invoice. It starts with an estimated cost, the job is won and performed, and in some cases the actual charges are more than the original estimate. Because commercial relocation is an inexact science, not everything can be known in advance, and when all is said and done, there may be a discrepancy between expected costs and actual costs. When that happens, I might have to discuss a possible resolution. Some people are hard liners and will not pay more than the estimate regardless of the circumstances or even if they request additional services to be performed. Other people pay additional charges without question. However most people are somewhere in the middle. I have learned that “winning” a negotiation, or getting the customer to pay all accrued hourly charges and materials against their will, may not be winning at all. The customer might agree to pay all charges, but they do so with the attitude that they will never use my services again. I believe that “winning” is a situation where all parties are comfortable, though not necessarily thrilled, with the final outcome. The very process of negotiation can build a stronger relationship and allow us to learn more about what makes the other person tick. Perhaps they are being told by their supervisor or CFO to pay as little as possible. Conversely, the person who performs the services might try to collect as much as possible. My point is that we should consider the long term consequences to all parties by strong-armed negotiation. I have developed many long term business relationships by trying to always be fair, reasonable, and honorable. It has paid great dividends. I don’t always “win” the negotiation, but I don’t burn bridges or bully people. Because of this, I sleep better at night.